Tom A. Loski Chief Regulatory Officer 16705 Fraser Highway ... · solution for managing multi-channel customer interactions, integrated with the SAP solution being implemented under

July 30, 2010 British Columbia Utilities Commission 6th Floor, 900 Howe Street Vancouver, BC V6Z 2N3 Attention: Ms. Erica M. Hamilton, Commission Secretary Dear Ms. Hamilton: Re: Terasen Gas Inc. ("Terasen Gas") Certificate of Public Convenience and

Necessity (“CPCN”) for the Customer Care Enhancement Project (“the Project”)

British Columbia Utilities Commission (the “Commission”) Order No. C-1-10 dated February 26, 2010 – Compliance Filing

Quarterly Progress Report for the period ending June 30, 2010

On February 26, 2010, the Commission issued Order No. C-1-10 granting a CPCN for the Project. Paragraph 3(i) of Order C-1-10 directed Terasen Gas to:

(i) file Quarterly Progress Reports on the Project with the Commission including planned versus actual schedule, planned versus actual costs, and identification of any variances or difficulties the Project may be encountering and any other items as determined necessary by Commission staff. The Quarterly Progress Reports are to be filed within 30 days of the end of each reporting period. A Final Report is to be filed within six months of completion of the Project;

Further on March 12, 2010, the Commission issued Order No. G-46-10 approving the establishment of a non-rate base deferral account for recording of currency exchange rate differences. Pursuant to Order No. G-46-10, paragraph 2, Terasen Gas has provided the deferral account transactions as a CONFIDENTIAL Appendix to the Quarterly Progress Report. If you require further information or have any questions regarding this submission, please contact the undersigned. Yours very truly, TERASEN GAS INC. Original signed by: Paul Craig

For: Tom A. Loski Attachments

Tom A. Loski Chief Regulatory Officer

16705 Fraser Highway Surrey, B.C. V4N 0E8 Tel: (604) 592-7464 Cell: (604) 250-2722 Fax: (604) 576-7074 Email: [email protected] www.terasengas.com Regulatory Affairs Correspondence Email: [email protected]

Tom A. Loski Chief Regulatory Officer

16705 Fraser Highway Surrey, B.C. V4N 0E8 Tel: (604) 592-7464 Cell: (604) 250-2722 Fax: (604) 576-7074 Email: [email protected] www.terasengas.com Regulatory Affairs Correspondence Email: [email protected]

TERASEN GAS INC.

Customer Care Enhancement Project

Quarterly Progress Report

For the Period ending June 2010

Compliance Filing in Accordance with Commission Order C-1-10

Submitted to the

BRITISH COLUMBIA UTILITIES COMMISSION

July 30, 2010

TERASEN GAS INC. – CUSTOMER CARE ENHANCEMENT PROJECT QUARTERLY PROGRESS REPORT – FOR THE PERIOD ENDING JUNE 30, 2010

Page i

Table of Contents

1 Executive Summary ............................................................................................................. 1

2 Reporting Directives ............................................................................................................ 2

3 Project Background ............................................................................................................. 3

4 Project ACTIVITIES .............................................................................................................. 4

5 Detailed Project Status ........................................................................................................ 5

5.1 Major Accomplishments, Work Completed and Issues Resolved................................. 5

5.1.1 Customer Relationship and Billing (CRB) and Operation Process Integration (OPI) .... 5

5.1.2 Contact Centre Technologies (CCT) and Contact Centre Facilities (CCF) ................... 6

5.1.3 Organizational design and Staffing (ODS) ..................................................................... 8

5.2 Plans for Next Period (July to Sep 2010) ...................................................................... 8

5.2.1 Customer Relationship and Billing (CRB) and Operation Process Integration (OPI) .... 9

5.2.2 Contact Centre Technologies (CCT) and Contact Centre Facilities (CCF) ................... 9

5.2.3 Organizational design and Staffing (ODS) ..................................................................... 9

5.3 Quality Assurance Review ............................................................................................ 9

6 Project Scope ..................................................................................................................... 10

7 Project Schedule ................................................................................................................ 11

7.1 Milestone Summary .................................................................................................... 11

7.2 Project Schedule ......................................................................................................... 11

8 Project Costs ...................................................................................................................... 12

9 Project Risks ...................................................................................................................... 14

9.1 Risk Description ....................................................................................................... 14

9.2 Potential Risk ............................................................................................................ 14

9.3 Mitigation Strategy ................................................................................................... 14


Page ii

List of Appendices

Appendix 1 Project Schedule

Appendix 2 List of Major Contractors

Appendix 3 Glossary of Acronyms and Terms

Appendix 4 Five Point Partners Assurance Review - CONFIDENTIAL

Appendix 5 News Article

Appendix 6 Currency Exchange Rate Deferral Transactions – CONFIDENTIAL


Page 1

1 EXECUTIVE SUMMARY

The current expected cost of the overall project including allowance for funds used during construction (AFUDC) remains unchanged at $115.5 million and the scheduled date that Terasen Gas will go live with the new system continues to be January 1, 2012.

The design teams have completed one third of the detailed design of the new system. The program management team has been established and the functional and technical design teams have been assembled. The largest meeting room on the first floor of Surrey operations was outfitted to house the project team, including Terasen Gas employees and on-site consultants. Other key project accomplishments this quarter include securing a lower mainland facility to house the primary contact centre and back office and billing operations and selection of a contact centre technology provider.

No scope changes have been issued to date and no new risks to the project have been identified. All project elements continue to proceed in accordance with the project schedule and Terasen Gas expects the detailed design phase of the project to be completed on time by October 29, 2010 with a system go-live date of January 1, 2012.

Five Point Partners (Five Points), a specialized provider of application management consulting services to organizations within the energy and utility industry, has been engaged to evaluate the project progress on seven key dimensions: schedule, resources, ongoing activities, project management, costs , scope and risks. Their independent review of the project progress has been included as Confidential Appendix 4 of this Progress Report.


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2 REPORTING DIRECTIVES

This report is the Quarterly Progress Report for the Customer Care Enhancement (“CCE”) Project (the “Project”) Certificate of Public Convenience and Necessity (“CPCN”), submitted in compliance with the directives of the British Columbia Utilities Commission (the “Commission”) Order No. C-1-10. Specifically, Terasen Gas was directed in paragraph 2(i) to:

“file Quarterly Progress Reports on the Project with the Commission including planned versus actual schedule, planned versus actual costs, and identification of any variances or difficulties the Project may be encountering and any other items as determined necessary by Commission staff. The Quarterly Progress Reports are to be filed within 30 days of the end of each reporting period. A Final Report is to be filed within six months of completion of the Project. “

Further, in Order No. G-46-10 under paragraph 2, Terasen Gas was directed to file the deferral account transactions as a confidential Appendix to the Quarterly Progress Reports.

This report constitutes the Quarterly Progress Report and serves to provide details of the Project progress and the specific items outlined above can be found in the following sections of this report:

Table 2.1: Report Sections

Order Number Item Section Reference

C -1-10 Planned versus Actual schedule Section 7.1: Milestone Summary

C-1-10 Planned versus Actual Costs Section 8 : Project Costs

C-1-10 Variances or Difficulties encountered

Section 5: Detailed Project Status

G-46-10 Deferral account transactions Appendix 6 -Confidential

This progress report serves to provide a comprehensive overview of the progress of the CCE project and the accomplishments to the period ending June 30, 2010.


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3 PROJECT BACKGROUND

The project involves in-sourcing of key components of customer care services and the implementation of a new Customer Information System (CIS) under the control of Terasen Gas.

This involves the implementation of technologies, including a new CIS technology platform, integrated with new contact centre technologies for managing customer interactions together with the creation of a new in-sourced customer care department to support the capability to deliver improved customer service. SAP’s CIS, Customer Relationship and Billing (CRB) system is the technology platform that will be used to enable the business processes needed to deliver customer care services.

The project represents a transition from the current Business Process Outsourcing1 model to a Strategic Sourcing model for customer care services. These customer care functions include the following activities:

• Call Centre

• Billing and Payments

• Collections

• Contract Management

• CIS Systems Support and Maintenance

• Meter Reading

The successful implementation of the CCE Project will enable Terasen Gas to fully own the direct customer experience and better position Terasen Gas to adapt to evolving customer needs. Customers will benefit from the expanded functional capabilities inherent in the SAP Utilities CRB module together with an internally managed customer care department based in British Columbia. The employee representatives of Terasen Gas will have improved knowledge of our broader environment and the impact of events in our marketplace in order to better understand and relate to customer experiences and direct ownership and oversight of employee training will ensure that customers can access the information that they need from knowledgeable representatives.

1 See Appendix 3 – Glossary – for definition


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4 PROJECT ACTIVITIES

In order to manage the various project activities the project work has been divided into five workstreams and these workstreams have been grouped into the three groups described below. The detailed activities of the project’s progress are presented in this report based on these three groups of activities.

Customer Relationship Billing (CRB) and Operation Process Integration (OPI)

The CRB program involves the implementation of the CRB for Utilities module of SAP and other related components of SAP. For delivery of the CRB system, Terasen Gas has partnered with HCL-Axon2.

The OPI program involves the reworking of various integrated processes and technology components that connect utility operations to the existing CIS (Peace 8).

Contact Centre Technologies (CCT) and Contact Centre Facilities (CCF)

The CCT Program is responsible for the implementation of Interactive Intelligence’s3 all in one solution for managing multi-channel customer interactions, integrated with the SAP solution being implemented under the CRB Project. For the implementation of the Contact Centre Technology, Terasen Gas has partnered with Altivon4, who is the implementation partner of Interactive Intelligence.

The CCF Program includes establishing two new contact centre facilities, one in the Lower Mainland and one in Prince George, to house the new Customer Care department being implemented through the Organizational Design and Staffing Program described below.

Organizational Design and Staffing (ODS)

The ODS program involves the design and implementation of the new customer care department, including the processes and controls required to operate and manage it, together with the hiring, on-boarding and training of the personnel required to staff it.

The ODS program is also responsible for the change management and communications activities for the entire CCE project.

2 See Appendix 3 – Glossary – for definition 3 See Appendix 2 – List of Major Contractors – for background information on Interactive Intelligence 4 See Appendix 2 – List of Major Contractors – for background information on Altivon


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5 DETAILED PROJECT STATUS

This section provides details of the project team’s major accomplishments, work completed and issues resolved for the period ending June 30, 2010 together with a description of the projects plans for the next period. These are described using the three groups of activities outlined in Section 4. All project elements continue to proceed in accordance with the project schedule and Terasen Gas expects the detailed design phase of the project to be completed on time by October 29, 2010 with a system go-live date of January 1, 2012.

5.1 Major Accomplishments, Work Completed and Issues Resolved

The focus for the period has been on developing the project plan, procuring key resources and entering into arrangements to ensure the successful implementation of the project deliverables.

5.1.1 CUSTOMER RELATIONSHIP AND BILLING (CRB) AND OPERATION PROCESS

INTEGRATION (OPI)

The following is a list of the major accomplishments and work completed for the period ending June 30, 2010:

• All system design project team members have received SAP training

• The following deliverables have been completed:

o Project Management Office has been established

o Mobilization Team5 has been established

o Project team has been mobilized and oriented

o Project Organization Roles and Responsibilities have been implemented

o Existing TGI process documentation has been gathered

o TGI’s legacy systems architecture documentation has been gathered

o TGI’s existing role, competency and organizational design documentation has been gathered

o Technical training has been provided

o Decision Making Model has been developed

o Project Toolset6 has been configured and is available

5 See Appendix 3 – Glossary – for definition 6 See Appendix 3 – Glossary – for definition


Page 6

o Project Risk register has been established

o Project infrastructure has been installed

• Blueprint Phase requirements validation workshops have been started

• Development of Business Process Designs (BPD’s) have been started

• Terasen Gas has been successful in reaching an agreement with the current customer information system provider (Hansen Technologies7) to support the data migration activities from the current CIS Peace 8 to SAP. Data migration is always a key focus for any system conversion effort and therefore the engagement of the legacy system provider is critical in order to mitigate risks around understanding the legacy system data and the subsequent mapping to the new system.

The first phase of the project, the preparation phase, took longer than anticipated due to delays in the mobilization of resources from HCL-Axon and other third party contractors. This challenge has been overcome and the project team is certain that the delay will not impact the next key project milestone(s). One third of the detailed design of the new system has already been completed and the project team is on track to complete the remaining two thirds on schedule.

5.1.2 CONTACT CENTRE TECHNOLOGIES (CCT) AND CONTACT CENTRE FACILITIES

(CCF)


• A lease agreement for the Lower Mainland Contact Centre Facility has been reached (detailed information is provided below)

• Terasen Gas has assumed ownership of the Prince George Contact Centre Facility and has issued a tender for the necessary building improvements. Please see Appendix 5 for a news article announcing the Prince George Facility.

• Software for the contact centre technology has been selected (detailed information is provided below)

Lower Mainland Contact Centre

A facility located in Burnaby, meets Terasen Gas’ key criteria and has been selected as the best location to house the primary contact centre, back office and billing operations in the Lower Mainland. Terasen Gas’ key requirements included adequate floor space, proximity to rapid transit and timely availability of the site to meet the project schedule.

7 See Appendix 2 – List of Major Contractors – for background information on Hansen Technologies


Page 7

It had been previously communicated that a Lower Mainland contact centre facility located in Surrey had been selected and that Terasen Gas was in negotiations and awaiting final approval from the landlord. The plan was to subcontract the lease from the existing leaseholder, however, Terasen Gas and the landlord were unable to come to a mutual agreement.

A number of different potential sites were explored in the Lower Mainland and Terasen Gas was successful in finding another facility that meets the desired requirements suitable to house the primary contact centre, back office and billing operations. A lease agreement for the building has been reached and all subjects were removed as of June 30th. The building is located on Still Creek Road in Willingdon Park, Burnaby and is a five minute drive away from Terasen Gas’ Burnaby operations. The closest skytrain station, Gilmore Station, is only a ten minute walk and there is a designated shuttle service at peak hours to the two closest skytrain stations (Gilmore and Brentwood Stations) and to Brentwood Mall.

The building is a designated Leadership in Energy & Environmental Design (LEED) Gold building. The facility provides for sufficient space, 53,211 sq ft located on the 3rd and 4th floors, to house both the primary contact centre, back office and billing operations under one roof. The operational benefits resulting from the close association of these operating groups will enable Terasen Gas to efficiently and effectively meet the needs of customers. Billing operations will be able to provide support to the call centre for complex billing issues and escalations. In addition, the billing group will be responsible for proactively identifying potential billing issues and contacting customers to discuss and resolve issues before they escalate.

Terasen Gas is confident that the Burnaby facility meets the requirements to house the primary contact centre, back office and billing operations and that the facility will be ready for the January 1, 2012 go-live date.

Contact Centre Technology

Concurrent with the later stages of the approval process of the original filing, there was significant activity in the industry of contact centre technology. Avaya acquired key components of Nortel and Interactive Intelligence introduced a new version of their product predicated on a updated architectural platform. The combination of these events caused Terasen to go back and re-evaluate the contact centre technology alternatives reviewed previously in light of this new information as well as a greater understanding of the detailed requirements and how they would need to be best implemented. After further detailed analysis of system requirements and proposed costing, it was determined that the solution provided by Interactive Intelligence was better suited to meet Terasen Gas’ needs. Terasen Gas is in the final stages of finalizing a contract with Altivon and Interactive Intelligence to provide a single solution for a unified Customer Interaction Centre for Terasen Gas customers.


Page 8

The Interactive Intelligence software has full integration capabilities with Terasen Gas’ chosen Customer Relationship Management (CRM) system provider, SAP. In addition, the application is both flexible and scalable to incorporate any future growth and change requirements. While Terasen Gas has selected an alternative contact centre technology provider in place of the provider outlined in the CPCN application as the preferred vendor at that point in time, it should be noted that the solution selected from Interactive Intelligence was short listed as the alternative during the initial evaluation stages and supports a full multi-channel suite and the new information provided during the re-evaluation addressed the shortcomings identified in the original analysis.

The solution will be implemented by Altivon, a system integrator who specializes in the implementation of the Interactive Intelligence solution. Scope of work documents have been prepared and finalized between both parties, and a high level project plan is currently in the development stages. A major milestones and deliverables document has been created and agreed to by both parties. Technical architecture topography has been completed incorporating both the Lower Mainland and Prince George Contact Centre requirements.

The timely arrangements for the Lower Mainland contact centre facility, a contact centre technology provider and the possession of the Prince George contact centre site have been major accomplishments for the project team during this reporting period.

5.1.3 ORGANIZATIONAL DESIGN AND STAFFING (ODS)


• All ODS team resources have been secured and the team will be responsible for Communications, Change Management and Human Resources for the new Customer Care Department;

• The Training and Documentation Strategy is currently on track and in development; and

• The Change Management Strategy is currently on track and in its final stages of development.

5.2 Plans for Next Period (July to Sep 2010)

The activities planned for the period July to September 30 have been outlined below. The key deliverables for the next period are to complete the CRB process design documentation, prepare documentation for the functional specifications of the contact centre technology and to begin renovations on the Prince George contact centre facility.


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5.2.1 CUSTOMER RELATIONSHIP AND BILLING (CRB) AND OPERATION PROCESS

INTEGRATION (OPI)

• All blueprint requirement validation workshops and all process design documentation will be completed for the customer relationship billing;

• The analysis of all forms, reports, interfaces, data conversion, enhancements and workflows (FRICE-W) will also be complete;

• Agreement for the data migration services from the Peace to SAP system will be finalized; and

• Scope and services for SAP Active Global Support8 will be finalized.

5.2.2 CONTACT CENTRE TECHNOLOGIES (CCT) AND CONTACT CENTRE FACILITIES

(CCF)

• Agreement for the contact centre software will be finalized and vendor resources on site;

• Functional design workshops and documentation of functional specifications for the contact centre technologies will be completed; and

• Bids for renovation work to the Prince George contact facility will be finalized.

5.2.3 ORGANIZATIONAL DESIGN AND STAFFING (ODS)

• The Training and Documentation and Change Management strategies will be finalized.

5.3 Quality Assurance Review

Five Point Partners (Five Points) has been engaged to provide assurance of on time execution of the project together with guidance on mitigation of risks. Five Points is a specialized provider of application management consulting services to organizations within the energy and utility industries. Five Points bring expert knowledge and experience in managing the development of Customer Information Systems. They will be utilizing their experience with numerous similar projects throughout North America to evaluate the project on seven key dimensions: schedule, resources, ongoing activities, project management, costs, scope, and risks.

A representative from Five Points is currently on site, working alongside the project team and will be providing guidance throughout the life of the project. Please see Appendix 4 for Five Points’ project status report.

8 Appendix 2


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6 PROJECT SCOPE

No project scope changes have been issued to date.


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7 PROJECT SCHEDULE

The overall project schedule’s critical path remains on track and the scheduled date Terasen Gas will go live with the new system and customer care department continues to be January 1, 2012.

7.1 Milestone Summary

The targeted project milestone dates for each of the project phases are outlined below. The project phases are described in more detail in Appendix 1.

The project preparation phase was completed June 30, later than the scheduled completion date of May 15 due to challenges with the mobilization of key project resources. The program team is currently actively engaged in the business blueprint phase and is on schedule to have this phase completed by October 29th, 2010. The initial delays in the preparation phase were not part of the project’s critical path and so the detailed business blueprint phase continues to proceed on schedule and the scheduled date that Terasen Gas will go live with the new system continues to be January 1st, 2012.

Table 7.1: Schedule

7.2 Project Schedule

The Project schedule is attached as Appendix 1 and reflects the full scope of work in the Customer Care Enhancement Project. The project schedule detail beyond the blueprint phase will be updated as more specific system design plans are developed through the blueprint phase.

PhasePlan Actual Forecast Plan Actual Forecast

1. Project Preparation Mar 1,2010 Mar 1,2010 n/a May 15,2010 Jun 30,2010 n/a

2. Business Blueprint May 3,2010 May 10,2010 n/a Oct 29,2010 n/a Oct 29,2010

3. Realization Nov 1,2010 n/a Nov 1,2010 Oct 31,2011 n/a Oct 31,2011

3a. Integration Test 1 Jun 6,2011 n/a Jun 6,2011 July 31,2011 n/a July 31,2011

3b. Integration Test 2 Aug 1,2011 n/a Aug 1,2011 Oct 31,2011 n/a Oct 31,2011

4. Final Preparation Nov 1,2011 n/a Nov 1,2011 Dec 31,2010 n/a Dec 31,2010

5. Stabilization Jan 1,2012 n/a Jan 1,2012 Mar 31,2012 n/a Mar 31,2012

Milestone Start Milestone End


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8 PROJECT COSTS

The actual project spend is behind the anticipated spend as a result of the delays in mobilization of key resources. This will have no impact on the forecasted spend for the project which remains at approved level of $115.5 million including AFUDC.

The selection of the Burnaby facility and an alternative contact centre technology provider has had minimal impact on the overall project costs. A control budget is currently under development and will be complete once the blueprint and detailed scope have been completed. The control budget will serve to provide a more accurate allocation of costs based on the confirmation of all scope issues driven out of the blueprint phase. The completed control budget will be filed with the Q4 2010 Progress report together with explanations of any changes from the budget supplied below and approved as part of the CPCN application process.

For the purposes of this report and for managing costs throughout the life of the project, costs have been categorized into two major categories – Capital and Deferred O&M. The components of these categories are shown in the resource view format illustrated below.

The year to date cost reporting summary to June 2010 is as follows:


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Table 8.1: Cost Reporting Summary to June 30, 2010

The current expected cost of the overall project including AFUDC remains unchanged at the approved level of $115.5 million.

Project Costs (000's) YTD

Spend to Date

CPCN Budget

Project Forecast Variance

CapitalInternal Labour 282 5,785 5,785 - Consulting 3,714 31,291 31,291 - Hardware 102 1,312 1,312 - Software 3,051 5,640 5,059 (581) Expenses 420 5,531 5,531 - Facilities 3,042 18,931 18,931 - Contingency - 8,516 8,516 -

10,611 77,006 76,425 (581)

Deferred O&MInternal Labour 43 9,631 9,631 - Consulting 251 19,194 19,194 - Software* 581 - 581 581 Expenses 41 2,053 2,053 - Facilities 2 1,037 1,037 - Contingency - 3,142 3,142 -

918 35,057 35,638 581

Net Total 11,529 112,063 112,063 -

AFUDC 256 3,437 3,437 -

Grand Total 11,785 115,500 115,500 -

* This item was erroneously categorized under capital in the CPCN Budget and will be corrected with the new control budget

Project Total


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9 PROJECT RISKS

The project management team has identified the following areas of focus in order to manage project risk.

Table 9.1: Project Risks

9.1 Risk Description

9.2 Potential Risk 9.3 Mitigation Strategy

Inflexibility of the go-live date

Solution quality may be sacrificed in order to meet the required date

A knowledgeable and experienced design team is engaged in the system design and a strong emphasis will be placed on the quality of the design and the solution. HCL-AXON, SAP, and Five Points have all been engaged to provide additional quality assurance on the project

System Performance

The stabilization period may be longer than anticipated as a result of system performance issues

SAP's Active Global Services will be on site periodically to assist the project team with testing and risk mitigation of system performance issues. They have sufficient experience to identify performance risk areas and resolve the types of system issues that could be encountered when the system goes live

The project management team has ensured appropriate risk mitigation efforts are in place and will continue to monitor and manage identified risks throughout the life of the project.

Appendix 1 PROJECT SCHEDULE

ID Task Name Duration

1 Customer Care Enhancment PM Tasks 569 days?

2 CCE Project Prep Phase 63 days?

3 Initiating 28 days?

20 Facilities 15 days

25 Project Team 10 days

33 CCE Business Blueprint Phase 112 days?

34 Initial Planning 32 days

53 Performance Reporting 109 days?

90 Quality Management 90 days

93 Updated / Control Plans 20 days

102 CCE Realization Phase 265 days?



158 Updated Plans 5 days

166 CCE Final Prep Phase 41 days?



182 Updated Plans 5 days

190 CCE Go-live and Support 88 days

191 Milestone Go-Live 0 days

192 Stabilization PM Tasks 60 days

193 Program Closure 15 days

196 Milestone Completion 0 days

197 Customer Relationship and Billling Project 569 days?

198 TGI SAP CRB Implementation Plan 569 days?

1 CRB Project Prep Phase 80 days?

2 Establish PMO and project standards 43 days?

18 Project Governance 80 days?

44 Project Mobilization 75 days

87 Project Management Approach / Methodology / Toolset 75 days

119 Functional & Technical Solution 23 days?

155 Milestone: Project Prep Complete 0 days

157 CRB Business Blueprint Phase 135 days

158 Project Management Blueprint Processes 1 day

161 Conduct QA Phase Review of Project Prep and Blueprint Mid Phase 3 days

162 Conduct QA Phase Review of Blueprint Design 3 days

163 Functional Blueprint Deliverables 135 days

711 Technical Blueprint Elements 129 days

1/2

3/30

5/3

Qtr 1 Qtr 2 Qtr 3 Qtr 4 Qtr 1 Qtr 2 Qtr 3 Qtr 4 Qtr 1 Qtr 22010 2011 2012

Task

Split

Progress

Milestone

Summary

Project Summary

External Tasks

External Milestone

Deadline

Page 1

Project: Customer Care EnhancementDate: 30-June-2010


768 Training and Change Management 125 days

848 Prepare for Realization Phase Activities 81 days

853 Blueprint Phase Planned Completion Date 0 days

855 CRB Realization Phase 260 days

856 Conduct QA Phase Review Build 3 days

857 Conduct QA Phase Review Test and Cut-Over Planning 3 days

858 Configure SAP 145 days

874 Develop Enhancements and Workflow 180 days

880 Develop Reports & Forms 180 days

888 Develop Interfaces 160 days

893 Data Migration Activities 120 days

900 Security Activities 120 days

904 Perform Testing Activities 259 days

927 Technical Activities 140 days

944 Change Management & Training 260 days

1024 Prepare for Final Preparation and Go-Live Phase 10 days

1027 Realization Phase Planned Completion Date 0 days

1029 CRB Final Preparation Phase 81 days

1030 Project Management Final Prep Phase 43 days

1035 User Acceptance Testing 40 days

1039 Establish Production System (SAP Production System) 42 days

1051 Data Migration 81 days

1060 System Testing 46 days

1078 Business Change & Integration 80 days

1109 Perform Cut-Over to Production 81 days

1119 CRB Go-Live and Support Phase 89 days

1120 Project Management Phase Activities 65 days

1122 Technical Stabilization 65 days

1137 User Support 65 days

1173 Project Closure Activities 65 days

199 Operations Process Integration Project 455 days

200 OPI Project Prep Phase 20 days

201 Process Scope 20 days

203 OPI Business Blueprint Phase 60 days

204 Process Designs 30 days

208 Functional Approach Docs and Plans 15 days

213 Functional Specs 55 days

218 SoW's and Detailed Plans 25 days

10/29

9/30


Task

Split

Progress

Milestone

Summary

Project Summary

External Tasks

External Milestone

Deadline

Page 2



223 OPI Realization Phase 270 days

224 Technical Specs 40 days

229 Build and Unit Test 80 days

235 Integration testing 85 days

239 OPI Final Prep Phase 40 days

240 OPI Go live & Support Phase 65 days

241 Organizational Design and Staffing Project 481 days

242 Process Designs 150 days

247 Organization Design 195 days

257 Communications 481 days

273 Change Management 380 days

287 Recruitment 367 days

301 Learning and Documentation 370 days

315 Business Advisory Team 401 days

320 Contact Centre Technology Project 496 days

321 Solution and Provided selection 74 days

326 Contracts 37 days

330 Customer Experience Strategy 35 days

334 Design and Specification Stage 115 days

340 Network Assessment Stage 30 days

341 Installation Phase 20 days

342 Programming and Development Phase 30 days

343 Testing Phase 30 days

344 Training Phase 30 days

345 Internal Cutover Phase 5 days

346 Transition Phase 5 days

347 User Acceptance Testing 45 days

348 External Cutover Phase 1 day

349 Implememtation Sign-off 15 days

350 Contact Centre Facilities Project 345 days

351 Lower Mainland Facility 239 days

352 Lower Mainland Schedule 239 days

1 Programming 16 days

8 Space planning + Schematic Design 23 days

19 Design development 21 days

26 Consultant Documentation 52 days

37 Tender 35 days

42 Permits and Construction 125 days


Task

Split

Progress

Milestone

Summary

Project Summary

External Tasks

External Milestone

Deadline

Page 3



353 Prince George Facility 344 days

354 Prince George Schedule 344 days

1 Programming 10 days

7 Schematic Design 27 days

15 Design Development 19 days

23 Contract documents 30 days

39 Tender 25 days

44 Permits and Construction 277 days


Task

Split

Progress

Milestone

Summary

Project Summary

External Tasks

External Milestone

Deadline

Page 4


APPENDIX 1

Page 5

Project Schedule

In order to assist with the interpretation of the project schedule, the project workstreams and project phases have been described below:

Description of Project Workstreams

In order to manage the various project activities the project work has been grouped into five workstreams and these workstreams are described below:

1. Customer Relationship Billing (CRB)

The CRB program involves the implementation of the CRB for Utilities module of SAP and other related components of SAP. For delivery of the CRB system, Terasen Gas has partnered with HCL-Axon.

2. Operation Process Integration (OPI)

The OPI program involves the reworking of various integrated processes and technology components that are connected to the existing CIS (Peace 8).

3. Organizational Design and Staffing (ODS)

The ODS program involves the design and implementation of the new customer care department, including the processes and control required to operate and manage it together with the hiring, on-boarding and training of the personnel required to staff it

The ODS program is also responsible for the change management and communications activities for the entire CCE project.

4. Contact Centre Technologies (CCT)

The CCT Program is responsible for the implementation of Interactive Intelligence’s all in one solution for managing multi-channel customer interactions, integrated with the SAP solution being implemented under the CRB Project. For the implementation of the Contact Centre Technology, Terasen Gas has partnered with Altivon, who is the implementation partner of Interactive Intelligence.

5. Contact Centre Technologies Facilites (CCF)

The CCF Program includes establishing two new contact centre facilities, one in the Lower Mainland and one in Prince George, to house the new Customer Care department being implemented through the ODS Program.

APPENDIX 1

Page 6

Description of Project Phases

The project consists of five phases, as described below. The Project Preparation phase has been completed and the project team is currently engaged in the Business Blueprint phase of the project.

Five project phases:

• Phase 1 – Project Preparation

• Phase 2 – Business Blueprint

• Phase 3 – Realization

• Phase 4 – Final Preparation

• Phase 5 - Stabilization

Phase 1 – Project Preparation In the Project Preparation phase, project facilities are established, equipment is ordered, the project is staffed and the team is trained in project methodology and tools.

Phase 2 – Business Blueprint (Detailed Design) The Business Blueprint phase involves the mapping of the business process requirements. During this phase all functional requirements are deployed into functional and technical specifications, all reports are identified and estimated, data conversion, testing, training and change management strategies are defined and all initially planned efforts are validated.

Phase 3 – Realization In this phase of the project, all configuration, development of reports, interfaces, and data conversion programs are developed and unit tested. Unit testing is the practice of validating that each individual component developed works to specifications.

Integration testing also forms a part of this phase, where all of the components that were developed and individually tested are then brought together and are run end-to-end to validate the overall business outcomes. Full data conversion is also tested in this phase of the project and the overall cutover planning is detailed. Training material and system documentation is also developed and training plans are established.

Phase 4 – Final Preparation In this phase all User Acceptance Testing is completed, all end user training is conducted, dress rehearsals for cutover are executed, and post go-live stabilization processes are detailed. This phase culminates with the go-live of the new CIS.

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Phase 5 – Stabilization During this phase, support resources from the implementation project are in place to assist in resolving any issues or errors that occur after the system goes live. The duration of this period is dependent upon how quickly the system performs to the original specifications, how closely the original specifications aligned with actual business processes and is also a factor of testing quality.

Appendix 2 LIST OF MAJOR CONTRACTORS

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List of Major Contractors

Please see the list below of the major contractors employed on the project and a description of their engagement:

Contractor Description of Engagement

Accenture

As the current support services provider, Accenture will be providing subject matter expertise in the areas of the existing call centre business processes, technical support specifically around the existing CIS technical environment as well as transition services during the cutover from the existing systems to the new environment.

Altivon and Interactive Intelligence

Interactive Intelligence will be providing the Contact Centre technologies, an all in one solution integrated with the SAP for managing multi-channel customer interactions.

For the implementation of the Contact Centre Technologies, Terasen Gas has partnered with Altivon, who is the implementation partner of Interactive Intelligence.

Hansen Technologies Hansen Technologies is the product owner of the CIS system currently utilized by Terasen Gas. Hansen will provide data migration services from their existing system to the new SAP CIS with the focus on legacy data quality and extraction.

HCL- Axon

HCL -Axon is an experienced SAP system integrator and specializes in the implementation of SAP computer systems. They also are experienced in the integration of complimentary software packages (such as bill composition software from Streamserve) to form a complete solution. They will be taking a leadership role in all phases of the project and providing expertise on the overall design of the system solution to ensure it conforms to Terasen Gas’ desired requirements. They will also provide guidance in the development of training and change management specific to the CIS implementation.

Five Point Partners Five Point Partners (Five Points )has been engaged to provide assurance of on time execution of the project together with guidance on mitigation of risks. Five Points Partners is a specialized provider of application management consulting services to organizations within the energy and utility industries. Five Points consultants bring expert knowledge and experience in managing the development of Customer Information Systems. They will be utilizing their experience with numerous similar projects throughout North America to evaluate the project on seven key dimensions: schedule, resources, ongoing activities, project management, costs, scope, and risks.

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Contractor Description of Engagement

R-Tech Technologies

R-Tech will be providing day-to-day program management for the CCE program. They will be responsible for coordinating and providing overall management of the various program streams including the CIS implementation, the Contact Centre technologies and facilities implementation as well as the other existing business processes that will be impacted by the CCE implementation. R-Tech has partnered with Terasen Gas on many initiatives over the last few years, and has in-depth knowledge of SAP, Terasen Gas’ operating model and provides Project Management Institute (PMI) certified project management services.

SAP Active Global Support

SAP's Active Global Services provide production support for all SAP customers. On this project, they will be assisting the project team by proactively reviewing key risk areas that have been experienced with other implementations and providing risk mitigation strategies of technical issues such as system performance. They have sufficient experience to identify performance risk areas and resolve the types of system issues that could be encountered when the system goes live.

SAP Consulting Services

As the CIS product vendor, SAP brings in-depth product knowledge and design architecture oversight to the project. They will also provide a quality assurance role in design and build reviews to ensure the implementation follows SAP best practices for implementation and maintainability.

Scivero Consulting Ltd

Scivero Consulting specializes in Strategic Training Management, Instructional Design, Communications, New Product Development, e-Learning, Cross Functional Process Development, Innovation, Workforce Education, and Transition Management. On the project, Scivero will be providing program leadership in the area of Change Management, Training and Communications

TELUS

TELUS will be providing technical infrastructure services to the project. This includes all server, desktop and network implementation and support services.

Appendix 3 GLOSSARY OF ACRONYMS AND TERMS

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Glossary

Acronyms

CCE Customer Care Enhancement

CIS Customer Information System

CRB Customer Relationship Billing

OPI Operation Process Integration

CRM Customer Relationship Management

Terms

AFUDC – acronym for Allowance for Funds Used During Construction, which allows for the cost of borrowing funds until a project is placed into service to be included in rates; the requirement for AFUDC forms a separate line item of the overall project cost.

Business Process Outsourcing (BPO) - the contracting of a specific business task, including all responsibility for the management of the business processes and underlying information technology systems and applications required for the completion of an activity, such as call handling, to a third-party service provider.

Deferred Costs – operating and maintenance costs that are incurred but that will be expensed in the future.

In-source - a business practice in which work that would otherwise have been contracted out is performed by internal Terasen Gas staff.

Mobilization Team – This is the initial team required on site for project preparation

Project Toolset – The project toolset is the AXON Project Support Environment (APSE . APSE is a structured project document management system used by the project team to manage the (CRB) project workflow and will serve as a repository for all CIS documentation throughout the life of the project.

Appendix 4 FIVE POINT PARTNERS ASSURANCE REVIEW

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Appendix 5 NEWS ARTICLE

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Terasen dials in downtown digs; Work set to begin on Second Avenue project Prince George Citizen Fri Jul 9 2010 Page: 1 / FRONT Section: News Byline: Gordon Hoekstra Source: The Citizen

Citizen photo by Brent Braaten Jan Marston, vice president of customer care for Terasen Inc., shows the design boards of the Terasen Contact Centre to city councillor Murry Krause Thursday morning during a news conference at the building on Second Avenue.

Renovations are expected to start soon on Terasen's new customer care centre in Prince George.

The centre is expected to employ 100 people when it is opens in January 2012.

Terasen looked at a number of cities in British Columbia, but chose Prince George because the downtown site is easily accessible and the city has a good base of knowledge workers, Jan Marston, a senior Terasen official, said Thursday.

Other senior Terasen officials were on hand in Prince George Thursday to announce their plans for the Second Avenue building, which included substantial upgrades.

The renovations are expected to be complete in the summer of 2011, when the company will begin recruiting.

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The upgrades include the building's mechanical system and exterior. Mock-ups of the plans include a second-floor patio and the use of Douglas fir and pine-beetle-killed wood - harvested within a 100-kilometre distance from Prince George - to highlight the community's forest industry history.

The reception area will include a spring forest theme.

"It specifies what we want to achieve here, today and in the future," said Marston, Terasen's vice-president of customer care.

"We are here for a long time," she added.

Terasen is opening two call centres - with the other in the Lower Mainland - as part of a $115.5 million plan to bring much of its customer services business back within the company. The company revealed it had purchased the former ACS call-centre building on Second Avenue from Initiatives Prince George just before last Christmas.

Terasen paid $2.35 million for the building.

The Terasen $115.5-million program, dubbed the customer care enhancement project, also includes a new information technology system meant to provide more online services for customers.

City councillor Murry Krause, who attended the Terasen announcement, said the firm's choice of Prince George for its customer service centre was important for the city.

"It will enhance the heart of our downtown," he said.

Initiatives Prince George CEO Tim McEwan said Terasen's choice of Prince George shows the city can attract this type of business. He pointed to a recent KPMG business cost-competitiveness location study that shows Prince George leading the pack in western Canada and the U.S. The study showed the city was the most competitive in the call centre, information technology and research and development sectors.

Terasen Gas delivers natural gas and piped propane to 900,000 customers in British Columbia - 95 per cent of the province's gas customers. Recently Fortis, a Canadian-based power company, bought Terasen from U.S.-based Kinder Morgan.

[email protected]

© 2010 Prince George Citizen

Edition: Final Story Type: Business Length: 414 words Idnumber: 201007090001

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Tone: Positive Ad Value: $910 Circulation: 17,023

Appendix 6 CURRENCY EXCHANGE RATE DEFERRAL TRANSACTIONS

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